Management Discussion and Analysis - Altius...

Management’s Discussion and Analysis of Financial Conditions and Results of Operations

Three months ended March 31, 2020

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This Management’s Discussion and Analysis (“MD&A”) should be read in conjunction with the Corporation’s consolidated financial statements

for the three months ended March 31, 2020 and related notes. This MD&A has been prepared as of May 11, 2020.

Management’s discussion and analysis of financial condition and results of operations contains forward–looking statements. By their nature,

these statements involve risks and uncertainties, many of which are beyond the Corporation’s control, which could cause actual results to differ

materially from those expressed in such forward-looking statements. Readers are cautioned not to place undue reliance on these statements.

The Corporation disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new

information, future events or otherwise.

Additional information regarding the Corporation, including the Corporation’s continuous disclosure materials, is available on the Corporation’s

website at www.altiusminerals.com or through the SEDAR website at www.sedar.com.

http://www.altiusminerals.com/

http://www.sedar.com/

Management Discussion and Analysis 2

Description of Business

The Corporation has three operating business segments – mineral royalties / streams, renewable royalties and project generation. The

Corporation’s diversified royalties and streams generate revenue from 15 operating mines located in Canada (14) and Brazil (1) that produce

copper, zinc, nickel, cobalt, potash, iron ore, thermal (electrical) and metallurgical (steel making) coal (see Appendix 1: Summary of Producing

Royalties and Streaming Interests). The Corporation further holds a diversified portfolio of pre-production stage royalties and junior equity

positions that it originates through mineral exploration initiatives within a business division referred to as Project Generation. The Corporation

also holds royalties related to renewable energy generation projects located primarily in the United States through a recently founded

subsidiary, Altius Renewable Royalties.

Additional information on the status of these royalty interests is available in Appendix 2: Summary of Exploration and Pre-Production Stage

Royalties of this MD&A.

Strategy

The Corporation’s strategy is to grow a diversified portfolio of royalties related to commodities and assets that benefit most from the

sustainability linked, macro-scale structural trends of fossil fuel to renewable based electrical generation conversion; transportation

electrification; lower emission steel making; and agricultural yield growth.

The Corporation gives priority to royalty interests in projects with large potential resource lives in order to maximize future option value

realization potential. The long average resource lives that remain for most of our current portfolio of royalties is a key strategic differentiator for

Altius within the broader resource royalty sector. Large resources are excellent predictors of project capacity expansions. Such occurrences

typically require capital investments by the mine operator, but as a royalty holder Altius pays no share of the cost incurred to gain these potential incremental benefits.

Altius also grows its portfolio of paying royalties by originating mineral projects and then retaining royalties upon their transfer to

mining/development companies. This approach is the core function of our Project Generation business and is another unique strategic

differentiator for Altius. In addition, the Project Generation business has a strong track record of earning substantial profits from the eventual

sale of junior equities that are often received beyond the retained royalties during project deal making. These profits can then be used for

further royalty acquisitions, as was the case when previous up-cycle profits were leveraged to provide the majority of our royalty acquisition

financing during the following cycle trough.

Whether considering M&A type mineral royalty acquisitions or its organic Project Generation business, Altius exercises rigorous counter-

cyclical discipline. Commodity markets are notoriously cyclical and individual asset valuations can change dramatically in accordance with

commodity prices and sentiment. Our mining royalty and mineral property acquisitions are primarily made during periods of low cyclical

valuations, while operator funded organic growth and equity gains / liquidity events typically become more pronounced during periods of better

cyclical valuations.

More recently, Altius expanded its focus on growing its royalty portfolio to benefit from sustainability-based macro trends by forming Altius

Renewable Royalties (“ARR”) as a subsidiary. ARR seeks to provide royalty based financing to renewable energy project originators and

developers and to then retain royalties once these projects are sold on to ultimate project sponsors and operators.

Outlook

The COVID-19 pandemic continues to cause financial, operational and economic uncertainty in all industries globally. The Corporation has

taken actions to augment its safety protocols, protect its employees, and to strengthen its balance sheet given the heightened uncertainty. The

Corporation began work from home measures effective March 16, 2020, curtailed all non-critical operating activities, and banned all non-

essential corporate travel for employees and directors. In late March the Corporation also sold 1,000,000 common shares in Labrador Iron Ore

Royalty Corporation (LIORC) for net proceeds of approximately $15,000,000, which brought the Corporation’s cash balance to approximately

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$30,000,000. This defensive cash position further enabled Altius to endure any prolonged or significant financial impacts of the pandemic while

providing a source of readily available capital for per share growth opportunities as uncertainties dissipate.

The Corporation provided shareholders with an update on March 27, 2020 noting the impacts that it was observing due to the COVID-19

epidemic with respect to both production volumes and prices, while also commenting that in these circumstances uncertainty around its royalty

revenue expectations remained high. Since then it has not been informed of any new material impacts to production volumes by the operators

of the mines from which it receives royalties. However, risks of further localized curtailments continue and the level of uncertainty surrounding

the near-term outlook for commodity prices remains at well beyond traditional levels. As a result, we have elected to withdraw the revenue

guidance that we originally provided on January 22, 2020.

The information provided below regarding expectations for production volumes and prices should therefore be considered as being provided

largely in the absence of future factoring for various potential COVID-19 impacts as they might relate to economic growth, supply chain

disruptions and government stimulus efforts, amongst many other possible variables including operator shutdowns.

Base metal production volumes in 2020, specifically those at 777 and Chapada, are expected to be relatively consistent with volumes seen in

2019; however base metal prices trended lower in the first quarter of 2020. At Gunnison, where Excelsior Mining has suspended its

commissioning activities for health and safety and liquidity preservation purposes, we currently presume no short-term contributions to revenue.

Royalty revenue at Voisey’s Bay is expected to be subdued as the mining operation is on care and maintenance and activities at the related

Long Harbour Processing plant rely solely upon available stockpiles.

The Iron Ore Company of Canada (“IOC”) mining complex in Labrador is continuing to operate at relatively normal levels and to benefit from

strong market and pricing for its high-quality iron ore production as a result of persistent, largely non COVID-19 related, global supply challenges. It has however noted that demand for its pellet products has weakened and that it has therefore elected to reduce pellet production

in favour of increased concentrate production. This has the potential to cause a reduction in top line sales revenue, and related LIORC royalty

payments from IOC, as pellets typically sell at a premium to concentrates. The impact to the portion of distributable cash flow that LIORC

receives related to its equity interest in IOC is expected to be less impacted marginally given that the reduction in pelletizing also results in

lower production costs.

Forecasts for long-term global potash demand growth remain positive; however prices declined throughout the quarter. In this price

environment rationalization of production to lower cost and recently expanded operations such as Rocanville and Esterhazy is expected to

continue to positively reflect in volumes attributable to Altius, given the Corporation’s higher weighted exposure to these lower cost operations.

Alberta’s Electric System Operator (“AESO”) saw near record demand in January 2020 setting an all time peak in electricity consumption due

to extreme cold weather conditions. Strong demand continued into March until demand began to taper as the pandemic began to impact

consumption and weather conditions normalized. Altius’ royalties related to thermal coal-fired electricity generation have no pricing exposure

and are paid on a per tonne basis.

The Corporation continues to achieve significant milestones in the advancement of its innovative royalty structure related to the renewable

energy generation sector. In Q1 2020, ARR announced a $47 million project portfolio based investment with Apex Clean Energy, one of the

largest wind and solar developers in the United States. This marked ARR’s second such transaction and largely completed the initial strategic

goal of Altius to invest its remaining expected thermal coal portfolio royalty revenues into the creation of a replacement long-life renewable

energy royalty portfolio far sooner than expected. The strategic objective of the business has now therefore been expanded and ARR continues

to advance several additional royalty investment opportunities. The Corporation also continues to evaluate the merits of working with strategic

co-investment partners, and of potentially spinning ARR out as renewable energy royalty public company, in order to best optimize its growth

potential.

Within the Project Generation business, field work and face to face interaction with business partners has been curtailed however we continue

to work closely with the management teams of our various junior equity portfolio investment companies to find ways to add value through the

provision of technical and various other supports where deemed helpful. We are also actively completing desktop based project generative

activities with a goal of adding new early stage mineral prospects to replenish our portfolio following several years of strong sales to select

industry partners.


Quarterly Highlights

Altius Renewable Royalties

On March 10, 2020, ARR entered into a $47 million (US$35 million) royalty investment agreement with Apex Clean Energy (“Apex”) to obtain

future royalties related to a broad portfolio of wind and solar energy development projects located across North America.

Apex is one of the largest renewable energy developers in the U.S. and has commercialized over 5 gigawatts (GW) of clean energy projects

since inception in 2009. Its current portfolio includes approximately 21 GW (12.5GW wind, 8.5GW solar) of development projects. The royalty

financing provided by ARR will allow Apex to accelerate the advancement and ultimate sale of wind and solar energy projects existing in the

portfolio and to add new projects to its portfolio.

Apex is committing its current portfolio of renewable energy development projects, and any newly acquired projects that it develops, to this

new royalty investment structure with ARR, excluding certain later stage portfolio projects that are already subject to sale, financing or

construction commitments. As individual projects from within the development portfolio reach commercial production, ARR will affix gross

revenue royalties on wind energy and solar energy projects until such time as a sufficient number of project royalties have been created to

meet a minimum return threshold. Each individual project royalty, once created, will encompass the full life of the project including any

extensions or enhancements that might occur.

Upon achieving certain milestones related to the vending of projects in Apex’s development pipeline, mutual options become exercisable to

provide continuing US$10 million tranches of royalty investment. Altius has financed the investment using its revolving credit facility.

Capital Allocation

During the quarter ended March 31, 2020 the Corporation repaid $5,000,000 in scheduled payments on its credit facilities, paid a quarterly cash dividend of five cents per common share, paid a quarterly distribution of $1,260,000 on its preferred securities and repurchased 255,600

of its shares at a cost of $2,643,000 under its normal course issuer bid. The Corporation also drew down on its revolving credit facility for

$47,326,000 to fund the Apex transaction. As noted above, the Corporation strengthened its financial position in the face of the economic

uncertainty by reducing its holding of LIORC.

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Financial Performance and Results of Operations

IN THOUSANDS OF CANADIAN DOLLARS (except per share amounts)

March 31, 2020 March 31, 2019 Variance

Revenue

Attributable royalty 16,279$ 21,844$ (5,565)$

Project generation - 9 (9)

Attributable revenue (1) 16,279 21,853 (5,574)

Adjust: joint venture revenue (3,230) (4,780) 1,550

IFRS revenue per consolidated f inancial statements 13,049 17,073 (4,024)

Total assets 566,567$ 613,108$ (46,541)$

Total liabilities 209,328 198,842 10,486

Cash dividends declared & paid to shareholders 2,090 1,714 376

Adjusted EBITDA (1) 12,723 17,359 (4,636)

Adjusted operating cash f low (1) 13,228 8,418 4,810

Net earnings (loss) (3,167) 6,616 (9,783)

Attributable revenue per share (1) 0.39$ 0.51$ (0.12)$

Adjusted EBITDA per share (1) 0.30 0.41 (0.11)

Adjusted operating cash f low per share (1) 0.32 0.20 (0.01)

Net earnings (loss) per share, basic and diluted (0.08) 0.15 0.50 (1) See non-IFRS measures section for definition and reconciliation

Three months ended

Attributable revenue (see non-IFRS measures) was $16,279,000 ($0.39 per share) in the first quarter of 2020, which was 25% lower than the

$21,844,0008 ($0.51 per share) recorded in the comparable quarter in 2019, mainly as a result of lower average potash prices and tonnes,

reduced LIORC dividends paid and reduced shareholding, planned sequencing activities at certain thermal coal mines as well as lower copper

sales at 777 and Chapada due to timing of sales.

Adjusted EBITDA in the quarter ended March 31, 2020 was $12,723,000 ($0.30 per share) was 27% lower than $17,359,000 ($0.41 per share)

for the prior year comparable quarter which is in accordance with reduced royalty revenue. The EBITDA margin of 78% was consistent with

the first quarter of 2019.

Adjusted operating cash flow was $13,228,000 ($0.32 per share), which was 57% higher than the $8,418,000 ($0.20 per share) generated in

2019 first quarter as a result of lower costs for general and administrative, costs of copper purchases related to the Chapada copper stream,

interest and taxes paid.

Net loss during the three months ended March 31, 2020 was $3,167,000 ($0.08 per share) compared to earnings of $6,616,000 ($0.15 per

share) recorded in the comparable three month period in 2019, mainly as a result of lower revenue from our diversified royalty portfolio as well

as non-cash impairment charges in associate, unrealized losses on derivatives and foreign exchange, and increases to depreciation,

amortization and taxes.

Total assets net of total liabilities decreased by approximately $57,000,000 over the comparable period in the prior year as a result of

unrealized loss on investments and one time impairment expenses offset by the monetization of investments in the Project Generation

business resulting in gains on disposition, which are described in further detail below.


Costs and Expenses

IN THOUSANDS OF CANADIAN DOLLARS

March 31, 2020 March 31, 2019 Variance

General and administrative 2,025$ 2,798$ (773)$

Cost of sales - copper stream 1,326 1,565 (239)

Share-based compensation 486 426 60

Generative exploration 139 3 136

Exploration and evaluation assets abandoned or impaired 70 - 70

Mineral rights and leases 42 47 (5)

Amortization and depletion 3,915 3,753 162

8,003$ 8,592$ (589)$

Costs and ExpensesThree months ended

General and administrative expenses for the three months ended March 31, 2020 were $773,000 lower than the prior year period. Current

quarter general and administrative costs are 28% lower than the prior year’s quarter and are reflective of lower salary related costs and lower

professional and corporate development fees recorded in ARR. ARR incurred employee and office costs of approximately $498,000 (March

31, 2019 - $650,000) during the current quarter (see segment note in the consolidated financial statements). In future periods it is expected

that the ARR related costs will be offset by asset growth and higher revenues as renewable energy royalty investments are completed and

projects subject to royalty begin to commission.

A significant component of general and administrative expenses of the Corporation relate to the administration and staffing of its Project

Generation segment. During the three months ended March 31, 2020 this amounted to $745,000 (March 31, 2019 - $1,145,000). This business

creates long term royalty development opportunities and also receives public equity positions in exchange for mineral projects and cash

investments. Net cash from equity sales and purchases completed by the Project Generation business generated $982,000 in the current

quarter. In considering the portion of general and administrative costs that relates to the Project Generation segment, and its negative impact

on adjusted EBITDA and EBITDA margin, it is important to note that equity sales are not included as a revenue contribution but are instead

recorded as gains in the statement of comprehensive earnings.

Decreased cost of sales for the Chapada copper stream are proportional to decreased copper stream revenue. Under the streaming agreement

the Corporation purchases 3.7% of the payable copper at 30% of the spot copper price. Amortization and depletion are higher for the three

months ended March 31, 2020 in comparison to the three months ended March 31, 2019 and includes amortization related to the Corporation’s

intangible assets which were part of the Great Bay Renewables acquisition in 2019.


March 31, 2020 March 31, 2019 VarianceEarnings from joint ventures 1,638$ 3,744$ (2,106)$ Gain on disposal of investments - 103 (103) Interest on long-term debt (1,899) (2,035) 136 Foreign exchange loss (971) (629) (342) Unrealized loss on fair value adjustment of derivatives (829) (345) (484) Share of loss and impairment in associates (4,004) (1,219) (2,785) Income tax (expense) recovery (2,148) (1,484) (664)

Other items Three months ended

Other factors which contributed to the change in the Corporation’s earnings are:

• Earnings from joint ventures were lower for the three months ended March 31, 2020 as a result of increased amortization and

depletion at the partnership level. Royalty revenues for the current quarter are also down from the prior year quarter based on

expected mine sequencing at Sheerness.

• The Corporation equity accounts for its shareholdings in Alderon Iron Ore Corporation (“Alderon”) and Adventus and has recorded

its share of loss and impairment in associate of $4,004,000 (March 31, 2019 - $1,219,000). On July 12, 2018 the Corporation

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participated in a US$14 million credit facility provided by Sprott Resource Lending by providing US$2,000,000 (CAD$2,625,000) to

Alderon. On April 1, 2020, Alderon announced it could not repay this debt. As a result, the Corporation has recorded an impairment

charge on the loan receivable of $1,625,000 and recorded an impairment of $1,544,000 which represents the entire value of its

equity investment in Alderon.

• An unrealized loss on the fair value of derivatives related to the revaluation of share purchase warrants impacted by the share

volatility in the junior mining sector was recorded for the three months ended March 31, 2020.

• Increased foreign exchange loss recorded in the current quarter was driven by fluctuating exchange rates since December 31, 2019.

• Tax expense is higher during the three months ended March 31, 2020 despite lower adjusted EBITDA which reflects a decrease in

tax rates in Alberta enacted effective January 1, 2020 offset with adjustments with respect to certain deferred tax asset capital items.

Segment Performance

During the quarter ended March 31, 2020, the Corporation began managing its business under three operating segments consisting of the

acquisition and management of producing and development stage royalty and streaming interests (“Mineral Royalties”); the acquisition and

management of renewable energy investments and royalties (“Renewable Royalties”) and; the acquisition and early stage exploration of

mineral resource properties with a goal of vending the properties to third parties in exchange for early stage royalties and minority equity or

project interests (“Project Generation”).

Mineral Royalties

A summary of the Corporation’s attributable royalty revenue and key highlights is as follows: IN THOUSANDS OF CANADIAN DOLLARS

March 31, 2020 March 31, 2019 VarianceRevenue

Base metals777 Mine 2,299 1,893$ 406$ Chapada 4,133 5,432 (1,299) Voisey's Bay 127 297 (170)

Metallurgical CoalCheviot 590 1,215 (625)

Thermal (Electrical) CoalGenesee 1,326 1,252 74 Paintearth 75 144 (69) Sheerness 1,030 1,535 (505) Highvale 82 337 (255)

PotashCory 223 324 (101) Rocanville 2,976 2,895 81 Allan 196 241 (45) Patience Lake 139 245 (106) Esterhazy 861 1,083 (222) Vanscoy 9 34 (25) Lanigan 2 5 (3)

Iron ore (1) 1,006 4,233 (3,227) Other

Renew ables 907 153 754 Coal bed methane 134 160 (26) Interest and investment 164 366 (202)

Attributable royalty revenue 16,279$ 21,844$ (5,565)$

(1)LIORC dividends receivedSee non-IFRS measures section of this MD&A for definition and reconciliation of attributable revenue

Summary of attributable royalty revenue Three months ended


Tonnes Average price (1) Tonnes Average price (1)

Chapada copper (3) 502 $2.83 US / lb 676 $2.73 US / lb

777 copper (4) 2,691 $2.55 US / lb 3,599 $2.82 US / lb

777 zinc (4) 9,432 $0.96 US / lb 6,431 $1.23 US / lb

Potash (5) 449,324 $332 / tonne 476,739 $400 / tonne

Metallurgical coal (6) 88,343 $184 / tonne 127,152 $232 / tonne

Thermal (electrical) coal (2,5) 452,900 N/A 729,582 N/A

(6) Represents portion of production at Teck's Cheivot mine subject to the royalty (50%)

(1) Average prices are in CAD unless noted

(2) Inflationary indexed rates

(3) Copper stream; quantity represents actual physical copper received

(4) 4% NSR; production figures shown represent 100% of production subject to the royalty

(5) Various production royalties; quantities represent tonnes subject to the royalties at each respective mine (royalty tonnes only)

Summary of attributable royalty volumes and average prices

Three months endedMarch 31, 2020 March 31, 2019

Base Metals

Chapada Copper Stream

Revenue at Chapada in the first quarter was down approximately 21% from the same quarter in 2019. Chapada started 2019 with strong sales

due to the lagged timing of production relative to sales at the end of 2018. On April 29, the operator, Lundin Mining Corp. (“Lundin”), reported

that Chapada remains on-track to achieve full year copper production guidance.

Voisey’s Bay Nickel-Copper-Cobalt Royalty

Overall, first quarter revenues were 57% lower than the first quarter in 2019 due to record snowfall in the month of January and other short-

term impacts at the Long Harbour processing facility. We expect nickel production to remain muted for the near term based upon recent

operator announcements.

On March 16, 2020 Vale announced a 4 week care and maintenance period at Voisey’s Bay mine as a precaution to help protect the health

and well being of indigenous communities where many of its employees reside. On April 8, 2020, Vale extended the care and maintenance

period for up to 3 months. Vale noted that the Long Harbour Processing Plant will continue to operate, drawing down on stockpiled concentrates

to produce nickel and cobalt.

Cardinal River Royalty

Lower sales volumes at Cardinal River in three months ended March 31, 2020 as compared to the three months ended March 31, 2019 resulted

in a 51% decrease in revenue. As the mine approaches the end of its scheduled life, geotechnical and closure considerations continue to

introduce variability in quarterly revenues. Teck Resources Limited announced that the mine closure is now expected by the end of June 2020.

Neither Altius nor the partnership that holds the Cheviot royalty will incur any share of reclamation costs associated with the closure.

Alberta Electrical Coal Royalties

Attributable production volumes during the first quarter were 37% lower than those of the prior year period based on expected temporary shifts

in mine sequencing off Altius’ royalty lands at Sheerness, resulting in lower revenues by 23% for the quarter ended March 31, 2020.

Altius continues to advance the lawsuit filed against both the Government of Alberta and the Government of Canada related to the Genesee

Royalty Limited Partnership, of which Altius is the general partner. This suit claims $190 million in damages, while describing actions that it

feels were tantamount to expropriation of its royalty interest in the Genesee mine, which is integrated with the Genesee power plant in Alberta,

Canada. The lawsuit is now entering the production and discovery phase.

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Saskatchewan Potash Royalties

Revenue from potash operations on which Altius holds royalties were 8.7% lower for the three months ended March 31, 2020 compared to the

same period in 2019 as a result of lower realized prices. Production volumes at the two largest contributors to Altius’s potash royalty revenue

were lower than the same quarter the previous year but showed improvements from the fourth quarter in 2019 where voluntary production

curtailments were ongoing. Revenues, despite being lower for the quarter, reflected improvements from the end of 2019 which saw production

curtailments at several of the mines subject to Altius royalties that were the result of inventory growth related to a weak weather-related planting

season in North America.

Iron Ore

The Corporation’s iron ore revenue stems from the pass through of royalties and equity dividends paid by IOC to Labrador Iron Ore Royalty

Corporation (“LIORC”). LIORC operates as a passive flow-through vehicle for proceeds from a 7% gross overriding royalty and a 15.1% equity

position held by LIORC on the IOC operations in Labrador, Canada. IOC did not declare an equity dividend in the first quarter as it chose to

maintain additional cash on its balance sheet, presumed to be reflective of additional planned sustaining and growth capital spending in 2020

and increased market uncertainty. During the quarter ended March 31, 2020, LIORC announced cash dividends for the first quarter of $0.35

per share, composed of a regular dividend of $0.25 per share and a special dividend of $0.10 per share versus in the first quarter of 2019 a

regular dividend of $0.25 per share and a special dividend of $0.80 per share.

Revenue for the quarter from LIORC was 76% lower than the same period in 2019, as a result of the lower dividend as well as the reduced

shareholding in LIORC by the Corporation described earlier.

777 Copper-Zinc-Gold-Silver Royalty

Royalty revenues from Hudbay’s 777 Mine were approximately 21% higher in the three months ended March 31, 2020 than in the comparable

three months in 2019. Zinc grades and recoveries improved in the first quarter of 2020 when compared same quarter in 2019, this was offset

slightly by lower realized copper grades. Comparing 777 revenues in Q1 2020 to the prior quarter, Q4 2019, we see an approximately 5%

decrease driven primarily by weaker base metal prices.

During the three months ended March 31, 2020 Hudbay Minerals Inc. reported the extension of the 777 mine life to the end of second quarter

of 2022, based on its most recent estimate of mineral reserves.

Renewable Royalties

Altius Renewable Royalties

On March 9, 2020, ARR investee company TriGlobal Energy (“TGE”) announced an agreement to sell the 180-MW Flatland Solar project

to Silverpeak Strategic Partners. This marked the third renewable energy royalty, and the first related to a solar energy project, under the

royalty financing agreement that ARR announced in 2019 with TGE.

On March 10, 2020 ARR entered into a US$35 million royalty investment agreement with Apex (see quarterly highlights section) to obtain

future royalties related to a broad portfolio of wind and solar energy development projects located across North America.

ARR continued to advance due diligence investigations and negotiations with several other renewable energy operators and developers

relating to additional potential royalty financing transactions.

Project Generation

Pre-Production Royalties & Junior Equities Portfolio Highlights

The Corporation’s junior equities portfolio had a market value of $34,000,000 at March 31, 2020. This amount excludes the market value of

LIORC and the fair value of privately held investments, which stood at $48,309,000 and $81,217,000 respectively. During the three months

ended March 31, 2020 the Corporation generated positive cash proceeds from sales, net of new investments, totaling $16,033,000 of which

$15,052,000 was generated by the sale of LIORC shares. The Corporation recognized a loss on disposition of investments of approximately

$5,100,000 in the consolidated statement of comprehensive earnings.


Advanced Project Stage Investments

Adventus Mining Corporation

Adventus Mining Corporation (“Adventus”) had previously reported plans of a US$7 million exploration campaign in 2020, to include drilling of

several targets at its Curipamba, Pijili and Santiago projects in Ecuador. However on March 18, 2020 Adventus announced a temporary

suspension of its planned exploration and development activities in response to the Government of Ecuador's declaration of a state of

emergency to prevent the spread of COVID-19. During the three months ended March 31, 2020, Adventus also announced the execution of

an agreement that will see South32 Limited explore its Rathkeale, Kingscourt and Fermoy projects in the Republic of Ireland, each of which

are subject to 2% NSR royalties in favour of Altius. Altius’s equity ownership in Adventus is approximately 15.51% and Altius holds a 2% NSR

on the Curipamba Project.

Adia Resources Inc.

Adia Resources Inc. (“Adia”), a private company 57.4% owned by Altius, has recently completed a second phase of drilling at its Lynx diamond

project in northern Manitoba, to follow up on three holes drilled in 2019 on its Eastern Bay target. The 2020 program included 7 drill holes

comprising 2,822 metres on both the Eastern Bay and Western Bay targets. Prospective ultramafic rocks were intersected in 5 of the 7 drill

holes. Adia has an agreement with De Beers Group (“De Beers”), which is providing in-kind technical support in exchange for shares in Adia.

All drill core is currently secured at De Beers technical facilities in Sudbury, Ontario, where detailed logging and sampling for microdiamond

analysis will be carried out on the 2020 core in the weeks ahead, with results anticipated later this summer subject to any operational delays

related to COVID-19.

Alderon Iron Ore

Alderon Iron Ore Corp. (“Alderon”) provided an update on April 1, 2020 with respect to its US$14-million loan facility due to Sprott Resource

Lending (“Sprott”) and its failure to repay the loan facility as of the extended maturity date of March 31, 2020. Alderon’s obligations under the

loan facility are secured against the Kami project and Sprott has indicated that it intends to realize on its security. As well as holding 52,865,442

shares in Alderon, Altius is a participant in the Sprott loan facility to the extent of US$2 million. At March 31, 2020 Altius recognized an

impairment charge on $1,625,000 on the loan receivable and reduced the carrying value of its equity investment to $nil.

Other

Altius holds other mineral rights targeting base, precious metals and diamond exploration opportunities in Canada (Newfoundland & Labrador,

Manitoba, Alberta, Saskatchewan), and the United States (Michigan), for which it is seeking capable partners.

The technical information contained in this MD&A has been reviewed and approved by Lawrence Winter, Ph.D., P.Geo., Vice‐President of

Exploration, a Qualified Person as defined by National Instrument 43-101 - Standards of Disclosure for Mineral Projects.

Readers are encouraged to visit the corporate website at www.altiusminerals.com to gain added insight into the exploration activities and

projects of the Corporation.

http://www.altiusminerals.com/

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Cash Flows, Liquidity and Capital Resources


March 31, 2020 March 31, 2019

Operating activities 9,167$ 4,303$

Financing activities 36,724 20,836

Investing activities (35,968) (32,254)

Net increase (decrease) in cash and cash equivalents 9,923 (7,115)

Cash and cash equivalents, beginning of period 22,128 28,392

Cash and cash equivalents, end of period 32,051$ 21,277$

Summary of Cash Flow sThree months ended

Operating Activities

Operating cash generated in the first quarter is higher than that of the prior year quarter despite decrease in overall royalty revenues. This is

mainly a result of lower costs for general and administrative, lower costs of copper related to the Chapada copper stream, timing of interest

and taxes paid.

Financing Activities

During the three months ended March 31, 2020 the Corporation completed a draw-down of $47,326,000 (March 31, 2019 - $25,208,000) on

its revolving credit facility which was used to fund its royalty investment agreement with Apex. The Corporation repaid $5,000,000 (March 31,

2019 - $5,000,000) during the three months ended March 31, 2020 related to its term loan facility.

A distribution on the Corporation’s preferred securities of $1,260,000 (March 31, 2019 - $1,260,000) was also completed during the three

months ended March 31, 2020.

The Corporation distributed $216,000 (March 31, 2019 - $293,000) to a non-controlling interest in Potash Royalty Limited Partnership during

the three months ended March 31, 2020. Proceeds from issuance of shares of $649,000 (March 31, 2019 - $3,895,000) was received during

the three months ended March 31, 2020 from non-controlling interests in Adia.

The Corporation declared and paid dividends of $2,090,000 (March 31, 2019 - $1,714,000) to its shareholders in the three months ended

March 31, 2020.

During the quarter the Corporation repurchased and cancelled 255,600 common shares under its normal course issuer bid for a total cost of

$2,643,000 compared to nil in the prior year.

Investing Activities

Joint venture-based royalty cash flow from our coal partnerships of $4,061,000 was in line with the prior year comparable quarter of $4,115,000.

The Corporation used $54,774,000 (March 31, 2019 - $1,714,000) in cash to acquire investments during the three months ended March 31,

2020, of which $48,364,000 (US $35,000,000) was used by ARR to acquire the Apex investment, $4,570,000 (US $3,500,000) (March 31,

2019 - $13,836,000 (US $3,500,000)) was used by ARR to add to the TGE investment and $1,840,000 (March 31, 2019 - $12,742,000) was

used to add to the LIORC position.

During the three months ended March 31, 2019 the Corporation, through its subsidiary ARR, acquired Great Bay Renewables, Inc. for

$6,152,000 (US$5,000,000) net of cash assumed.

The Corporation received $16,033,000 from the sale of investments for the three months ended March 31, 2020 (March 31, 2019 - $7,789,000)

consisting mostly of proceeds of $15,052,000 from the sale of LIORC shares.

The Corporation acquired mining royalty interests at a cost of $13,474,000 during the prior year quarter, which included the 2% NSR on the

Curipamba copper project.


Liquidity

At March 31, 2020 the Corporation had current assets of $43,427,000, consisting of $32,051,000 in cash and cash equivalents and $8,455,000

primarily in accounts receivable, loan receivable and prepaid expenses, with the remainder in income taxes receivable. Current liabilities of

$26,299,000 include the current portion of long-term debt obligations of $20,000,000, which are paid quarterly. The Corporation’s major

sources of free cash flow are from royalty income and streaming revenue, cash receipts from royalty partnership interests, sales of direct and

indirect exploration investments, and investment income. The Corporation monetized certain portfolio investments during the current quarter

and generated $16,033,000 in cash, At March 31, 2020 the Corporation has approximately $35,000,000 of available liquidity under its revolving

credit facility.

Summary of Quarterly Financial Information

The table below outlines select financial information related to the Corporation’s attributable revenue, adjusted EBITDA, net (loss) earnings

and net (loss) earnings per share for the most recent eight quarters. The financial information is extracted from the Corporation’s condensed

consolidated financial statements and should be read in conjunction with those statements and the annual audited consolidated financial

statements. IN THOUSANDS OF CANADIAN DOLLARS (except per share amounts)

March 31, 2020 December 31, 2019 September 30, 2019 June 30, 2019

Attributable revenue (1) 16,279$ 17,557$ 19,256$ 19,538$ Adjusted EBITDA (1) 12,723 13,624 15,241 16,344 Adjusted operating cash flow (1) 13,228 9,442 14,368 11,849 Net earnings (loss) attributable to

common shareholders (3,546) 8,842 4,450 (2,068)

Attributable revenue per share (1) 0.39$ 0.41 0.45 0.46 Adjusted EBITDA per share (1) 0.30 0.32 0.35 0.38 Adjusted operating cash flow per share (1) 0.32 0.22 0.33 0.28 Net earnings (loss) per share

- basic and diluted (0.08) 0.21 0.10 (0.05)


Attributable revenue (1) 21,853$ 17,912$ 17,634$ 16,757$ Adjusted EBITDA (1) 17,359 13,383 13,381 13,032 Adjusted operating cash flow (1) 8,418 9,776 7,355 9,489 Net earnings attributable to

common shareholders 6,248 (12,578) 6,025 5,291

Attributable revenue per share (1) 0.51$ 0.42$ 0.40$ 0.39$ Adjusted EBITDA per share (1) 0.41 0.32 0.32 0.30 Adjusted operating cash flow per share (1) 0.20 0.23 0.17 0.21 Net earnings per share

- basic and diluted 0.15 (0.29) 0.14 0.12 (1) Non-IFRS measures are reconciled and described in the Non-IFRS Measures section of this MD&A(2) Condensed period (2 months) due to change in fiscal year EBITDA is derived primarily from the high margin royalty business, which includes attributable royalty and streaming revenue from our 15

producing mines, all net of G&A and operating costs. Attributable royalty revenue is contingent on many factors including commodity prices,

mine production levels, mine sequencing, maintenance schedules and the timing of concentrate shipments, which in some cases are affected

by seasonality and outside events. Adjusted EBITDA is proportionate with royalty revenue while earnings have been impacted by non-cash

impairments, unrealized losses and gains. Adjusted operating cash flow is derived from cash flow from operations and adjusted to include

distributions from joint ventures on the basis that the joint venture cash flows form part of our royalty business. The changes in adjusted

operating cash flow is generally consistent with royalty revenue as well as interest and taxes paid. During the quarter, royalty revenue was

impacted by base metal prices being under pressure from geopolitical concerns, by potash prices and volumes being lower, a lower quarterly

dividend declared by LIORC and overall declines in commodity prices.

13

Net earnings are affected primarily by revenue net of operating expenses as noted above but are also affected by the realization of both cash

and non-cash gains or losses on the Corporation’s investments, mineral properties and mineral exploration alliances and the equity accounting

of some investments. The quarter was negatively impacted by loss and impairment in associates.

Commitments and Contractual Obligations

The Corporation has obtained various mineral rights in Canada, the United States, and Australia by staking claims and paying refundable

security deposits. On these lands, certain expenditures are required on an annual basis from the date of license issuance in order to maintain

the licenses in good standing, and for security deposits thereon. On or before the anniversary date of license issuance, and if the required

expenditures are not met, the Corporation has the option of reducing claims on a property, posting a refundable security bond for the deficient

amount or electing to allow title of the license to be cancelled. In aggregate, the Corporation is required to spend an additional $465,000 by

March 31, 2021 in order to maintain its various licenses in good standing.

As at March 31, 2020 the following principal repayments for the Corporation’s credit facilities are required over the next 4 years:


Term Revolver Total

2020 20,000$ -$ 20,000$

2021 20,000 - 20,000

2022 20,000 - 20,000

2023 30,000 64,011 94,011

90,000$ 64,011$ 154,011$

The Corporation has committed to pay, on the anniversary date of November 1, a limited royalty to McChip Resources Inc. of $500,000 per

year for the next eight years based on a minimum production and grade threshold at the Rocanville mine. The 2020 payment is due in the

fourth quarter of 2020.

The Corporation has committed to investing, in tranches, a total of US$30,000,000 over the next two years as requested by TGE as they achieve certain renewable energy project advancement milestones. As at March 31, 2020 US$14,000,000 has been funded and the

Corporation funded an additional US$3,000,000 subsequent to the end of the quarter.

Upon achieving certain milestones related to the vending of projects in Apex’s development pipeline, mutual options become exercisable to

provide continuing US$10 million tranches of royalty investment.

Related Party Transactions

During the three months ended March 31, 2020 the Corporation was billed $6,000 by an associate (March 31, 2019 - $6,500) for general

administrative expenses.

Key management personnel include those persons having authority and responsibility for planning, directing and controlling the activities of

the Corporation as a whole. The Corporation has determined that key management personnel consist of members of the Corporation’s Board

of Directors and five corporate officers, including the Corporation’s Executive Chairman, Chief Executive Officer and Chief Financial Officer,

as well as two Vice Presidents reporting directly to a corporate officer.

During the three months ended March 31, 2020 the Corporation paid compensation to key management personnel and directors of $1,669,000

(March 31, 2019 - $1,641,200) related to salaries and benefits and incurred $486,000 (March 31, 2019 - $426,000) in share-based

compensation costs.


These related party transactions are in the normal course of operations and are measured at fair value, which is the amount of consideration

established and agreed to by the related parties. It is management’s estimation that these transactions were undertaken under the same terms

and conditions as would apply to transactions with non-related parties.

Critical Accounting Estimates

The preparation of financial statements in accordance with IFRS requires management to make estimates and assumptions that affect the

reported amounts of assets and liabilities, the disclosure of contingent liabilities and the reported amounts of revenues and expenses during

the reporting period. Areas requiring the use of management estimates include business combinations, rates for amortization and depletion of

the royalty and streaming interests, deferred income taxes, the carrying value and assessment of impairment of mining and other investments,

investments in joint ventures and royalty interests, the assumptions used in the determination of the fair value of share based compensation,

the assessment of impairment of goodwill and the assumptions used in the determination of the fair value of derivatives for which there is no

publicly traded market.

New Accounting Policies

The Corporation has not adopted any new accounting policies during the three months ended March 31, 2020. The Corporation has adopted

the following amendments effective January 1, 2020.

IFRS 3 – Business combinations

An amendment to IFRS 3, Business Combinations, effective for annual periods for on or after January 1, 2020 clarifies the definition of a

business and provides guidance in determining whether an acquisition is a business combination or a combination of a group of assets. The

amendment emphasizes that the output of a business is to provide goods and services to customers and provides supplementary guidance. The Corporation had no material impact upon applying this amendment.

IAS 1 – Presentation of financial statements

An amendment to IAS 1, Presentation of Financial Statements, effective for annual periods for on or after January 1, 2020 clarifies the definition

of “material” to align the definition used in the Conceptual Framework developed by the IASB and all other accounting standards. Under the

amendment, information is defined as “material” if, “omitting, misstating or obscuring it could reasonably be expected to influence decisions

that the primary users of general purpose financial statements make on the basis of those financial statements, which provide financial

information about a specific reporting entity”. The Corporation had no material impact upon applying this amendment.

Internal Control over Financial Reporting

Management is responsible for the establishment and maintenance of a system of internal control over financial reporting. This system has

been designed to provide reasonable assurance that assets are safeguarded and that the financial reporting is accurate and reliable. The

certifying officers have evaluated the effectiveness of the Corporation’s internal control over financial reporting as of March 31, 2020 and have

concluded that such controls are adequate and effective to ensure accurate and complete financial reporting in public filings. The condensed

consolidated financial statements have been prepared by management in accordance with IFRS and in accordance with accounting policies

set out in the notes to the consolidated financial statements for the three months ended March 31, 2020. There has been no change in the

Corporation’s internal control over financial reporting during the Corporation’s quarter ended March 31, 2020 that has materially affected, or is

reasonably likely to materially affect, the Corporation’s internal control over financial reporting.

Evaluation and Effectiveness of Disclosure Controls and Procedures

The Corporation has established and maintains disclosure controls and procedures over financial reporting. The certifying officers have

evaluated the effectiveness of the issuer’s disclosure controls and procedures as of March 31, 2020 and have concluded that such procedures

are adequate and effective to ensure accurate and complete disclosures in public filings.

15

There are inherent limitations in all control systems and no disclosure controls and procedures can provide complete assurance that no

future errors or fraud will occur. An economically feasible control system, no matter how well conceived or operated, can provide only

reasonable, not absolute, assurance that the objectives of the control system are met.

Risk Factors and Key Success Factors

An investment in securities of the Corporation involves a significant degree of risk that should be considered prior to making an investment

decision. In addition to discussions of key success factors and business issues elsewhere in this MD&A, the investor should consider risk

factors. Please refer to the annual financial statements and MD&A for the year ended December 31, 2019 for a complete listing of risk factors

specific to the Corporation. The following risk, while disclosed in the year end MD&A, has been identified in the current period as critical.

COVID-19

Certain impacts to public health conditions particular to the coronavirus (COVID-19) outbreak that occurred during the quarter may have a

significant negative impact on the operations and profitability of the Corporation. The extent of the impact to the financial performance of the

Corporation will depend on future developments. Potential impacts could include an adverse affect on the economies and financial markets of

many countries, resulting in an economic downturn which could adversely affect the Corporation’s business and the market price of the common

shares. Many industries, including the mining industry have been impacted by these market conditions. The continuation of increased levels

of volatility or the destabilization of global economies may result in a material adverse effect on commodity prices, demands for metals,

availability of credit, investor confidence and general financial market liquidity, all of which may adversely affect the Corporation’s business

and the market prices of the Corporation’s securities.

In addition, there may not be an adequate response to emerging infectious diseases, or significant restrictions may be imposed by a government, either of which may impact the Corporation and the underlying mining operations. There are potentially significant economic and

social impacts, including labour shortages and shutdowns, delays and disruption in supply chains, social unrest, government or regulatory

actions or inactions, including quarantines, declaration of national emergencies, permanent changes in taxation or policies, decreased demand

or the inability to sell and deliver concentrates and resulting commodities, declines in the price of commodities, delays in permitting or approvals,

suspensions or mandated shut downs of operations, governmental disruptions or other unknown but potentially significant impacts. At this time

the Corporation cannot accurately predict what effects these conditions will have on its operations or financial results, due to uncertainties

relating to the ultimate geographic spread, the duration of the outbreak, and the length restrictions or responses that have been or may be

imposed by various governments. Any outbreak or threat of an outbreak of a contagion or epidemic disease could have a material adverse

effect on the Corporation, its business and operational results.

Outstanding Share Data

At May 11, 2020 the Corporation had 41,643,496 common shares outstanding, 7,070,000 warrants outstanding and 1,134,404 stock options

outstanding.

Non-IFRS Measures

Attributable royalty and other revenue (“attributable revenue”), adjusted EBITDA and adjusted operating cash flow are intended to provide

additional information only and does not have any standardized meaning prescribed under IFRS and should not be considered in isolation or

as a substitute for measures of performance prepared in accordance with IFRS. These measures are not necessarily indicative of operating

profit or cash flow from operations as determined under IFRS. Other companies may calculate these measures differently. For a reconciliation

of these measures to various IFRS measures, please see the Corporation’s MD&A disclosure below. Tabular amounts are presented in

thousands of Canadian dollars.

1. Attributable revenue is defined by the Corporation as total revenue and other income from the consolidated financial statements plus

the Corporation’s proportionate share of gross royalty revenue in the joint ventures. The Corporation’s key decision makers use

attributable royalty revenue and related attributable royalty expenses as a basis to evaluate the business performance. The


attributable royalty revenue amounts, together with amortization of royalty interests, general and administrative costs and mining

tax, are not reported gross in the consolidated statement of earnings (loss) since the royalty revenues are being generated in a joint

venture and IFRS 11 Joint Arrangements requires net reporting as an equity pick up. The reconciliation to IFRS reports the

elimination of the attributable revenues and reconciles to the revenues recognized in the consolidated statements of earnings (loss).

Attributable revenue per share is derived by using the basic weighted average number of shares for the period as the denominator.

2. Adjusted operating cash flow is defined as cash provided (used) in operations adjusted for inclusion of the cash distributions received

from joint ventures. Adjusted operating cash flow is a useful measure to assess the ability of the Corporation to generate cash from

its operations. Adjusted operating cash flow per share is derived by using the basic weighted average number of shares for the

period as the denominator.

3. Adjusted EBITDA is defined by the Corporation as net earnings (loss) before taxes, amortization, interest, non-recurring items, non-

cash amounts such as impairment, losses and gains, and share based compensation. The Corporation also adjusts earnings in joint

ventures to reflect EBITDA on those assets which exclude amortization of royalty interests as well as adjusting for any one time

items. Adjusted EBITDA is a useful measure of the performance of our business, especially for demonstrating the impact that EBITDA

in joint ventures have on the overall business. Adjusted EBITDA identifies the cash generated in a given period that will be available

to fund the Corporation’s future operations, growth opportunities, shareholder dividends and to service debt obligations. Adjusted

EBITDA per share is derived by using the basic weighted average number of shares for the period as the denominator.

17

Below are the eight most recent quarter reconciliations.


Reconciliation to IFRS measuresAttributable revenue March 31, 2020 December 31, 2019 September 30, 2019 June 30, 2019

Revenue

Attributable royalty 16,279$ 17,497$ 19,231$ 19,533$

Project generation - 60 25 5

Attributable revenue 16,279 17,557 19,256 19,538

Adjust: joint venture revenue (3,230) (4,172) (3,674) (4,353)

IFRS revenue per consolidated financial statements 13,049$ 13,385$ 15,582$ 15,185$

Reconciliation to IFRS measuresAttributable revenue March 31, 2019 December 31, 2018 September 30, 2018 June 30, 2018

RevenueAttributable royalty 21,844$ 17,615$ 17,084$ 16,543$

Project generation 9 297 550 214

Attributable revenue 21,853 17,912 17,634 16,757 Adjust: joint venture revenue (4,780) (4,545) (3,953) (3,965) IFRS revenue per consolidated financial statements 17,073$ 13,367$ 13,681$ 12,792$

IN THOUSANDS OF CANADIAN DOLLARSAdjusted operating cash flow March 31, 2020 December 31, 2019 September 30, 2019 June 30, 2019

Adjusted operating cash flow 13,228$ 9,442$ 14,368$ 11,849$ Adjust: distributions to (from) joint ventures (4,061) (3,550) (4,319) (4,698) IFRS operating cash flows 9,167$ 5,892$ 10,049$ 7,151$

Adjusted operating cash flow March 31, 2019 December 31, 2018 September 30, 2018 June 30, 2018

Adjusted operating cash flow 8,418$ 9,776$ 7,355$ 9,489$ Adjust: distributions from joint ventures (4,115) (3,601) (3,966) (4,744) IFRS operating cash flows 4,303$ 6,175$ 3,389$ 4,745$



Earnings (loss) before income taxes (1,019)$ 9,034$ 6,166$ (2,881)$

Addback(deduct):

Amortization and depletion 3,915 4,014 4,061 3,801

Exploration and evaluation assets abandoned or impaired 70 35 - 9,004

Share based compensation 486 382 544 663

Interest on long-term debt 1,899 2,018 1,982 2,092

Unrealized (gain) loss on fair value adjustment of derivatives 829 54 (60) (955)

Dilution gain on issuance of shares in associates - - (1,114) (1,199)

Share of (earnings) loss and impairment in associates 4,004 751 884 903

(Earnings) loss from joint ventures (1,638) (2,463) (869) 673

LNRLP EBITDA (1) 99 219 291 202

Prairie Royalties EBITDA (2) 3,107 3,808 3,313 4,093

Impairment of goodwill & royalty interest - - - -

Foreign currency (gain) loss 971 22 43 (52)

Gain on disposal of royalty interest - (4,250) - -

Adjusted EBITDA 12,723$ 13,624$ 15,241$ 16,344$

(1) LNRLP EBITDA

Revenue 127$ 337$ 369$ 252$

Mining taxes (25) (63) (78) (50)

Admin charges (3) (55) - -

LNRLP Adjusted EBITDA 99$ 219$ 291$ 202$

(2) Prairie Royalties EBITDA

Revenue 3,103$ 3,835$ 3,305$ 4,101$

Operating income (expenses) 4 (27) 8 (8)

Prairie Royalties Adjusted EBITDA 3,107$ 3,808$ 3,313$ 4,093$

Reconciliation to IFRS measuresAdjusted EBITDA


19


Earnings before income taxes 8,100$ (12,701)$ 7,746$ 6,647$

Addback(deduct):Amortization 3,753 3,495 4,239 3,805 Exploration and evaluation assets abandoned or impaired - 195 576 4 Share based compensation 426 327 505 774 Interest on long-term debt 2,035 2,038 2,058 2,634 Gain on disposal of investments & impairment recognition (103) - - - Unrealized (gain) loss on fair value adjustment of derivatives 345 4,098 56 (1,897) Dilution gain on issuance of shares by associates - (257) (2,025) - Share of loss and impairment in associates 1,219 1,390 (316) 150 (Earnings) loss from joint ventures (3,744) 566 (2,734) (3,006) LNRLP EBITDA (1) 237 278 22 (103) Prairie Royalties EBITDA (2) 4,462 3,786 3,601 3,964 Impairment of goodw ill - 10,810 - - Foreign currency loss 629 (642) 153 60

Adjusted EBITDA 17,359$ 13,383$ 13,881$ 13,032$

(1) LNRLP EBITDA

Revenue 297$ 622$ 351$ -$

Mining taxes (60) (124) (70) -

Admin charges - (220) (259) (103)

LNRLP Adjusted EBITDA 237$ 278$ 22$ (103)$

(2) Prairie Royalties EBITDA

Revenue 4,483$ 3,923$ 3,602$ 3,965$

Operating expenses (21) (137) (1) (1)

Prairie Royalties Adjusted EBITDA 4,462$ 3,786$ 3,601$ 3,964$

Reconciliation to IFRS measuresAdjusted EBITDA March 31, 2019 December 31, 2018 September 30, 2018 June 30, 2018


Appendix 1 – Summary of Producing Royalties and Streaming Interests

Mine / Project Primary Commodity Operator Revenue Basis

Chapada Copper Lundin Mining 3.7% of payable copper stream

777 Zinc, Copper, Gold & Silver Hudbay Minerals 4% Net smelter return ("NSR")

Genesee Coal (Electricity) Westmoreland/Capital Pow er Corporation Tonnes x indexed multiplier

Sheerness Coal (Electricity) Westmoreland/ATCO/TransAlta Tonnes x indexed multiplier

Paintearth Coal (Electricity) Westmoreland/ATCO Tonnes x indexed multiplier

Highvale Coal (Electricity) TransAlta Tonnes x indexed multiplier

Cheviot Metallurgical Coal Teck 2.5% effective net revenue

Rocanville Potash Nutrien Revenue

Cory Potash Nutrien Revenue

Allan Potash Nutrien Revenue

Patience Lake Potash Nutrien Revenue

Esterhazy Potash Mosaic Revenue

Vanscoy Potash Nutrien Revenue

Voisey’s Bay Nickel, Copper, Cobalt Vale 0.3% NSR

IOC Iron Iron Ore Company of Canada 7% Gross Overriding Royalty ("GOR")*

Carbon Development Potash, other Various Revenue

Clyde River Renew able Energy Gravity Renew ables Revenue

* Held indirectly through common shares of Labrador Iron Ore Royalty Corporation

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Appendix 2 – Summary of Exploration and Pre-Development Stage Royalties

PropertyPrimary

Commodity Explorer/Developer Royalty Basis Status

Gunnison Copper Excelsior Mining Corp. 1.625% GSR

Construction completed,

commissioning temporarily suspended

Kami(Labrador) Iron Alderon Iron Ore Corp 3% GSR

Updated feasibility study

Curipamba(Ecuador) Copper Adventus Mining Corporation 2% NSR PEA completed

Tres Quebradas (3Q)(Argentina) Lithium Neo Lithium Corp. 0.1% GSR PEA completed

Telkw a(British Columbia) Met Coal Allegiance Coal Limited 1.5-3% price based sliding scale GSR

Definitive feasibility study completed and permitting underw ay

PropertyPrimary

Commodity Explorer/Developer Royalty Basis Status

Viking(New foundland) Gold Anaconda Mining Inc

2% NSR, plus 1-1.5% royalties on surrounding lands

Advanced Exploration; inactive

Central Mineral Belt(Labrador) Copper Paladin Energy Ltd

2% NSR on all minerals except uranium

Advanced Exploration; inactive

Grota de Cirilo(Brazil) Lithium Sigma Lithium Resources 0.1% GOR* Advanced exploration

Stellar(Alaska) Copper PolarX Ltd

2% NSR on gold; 1% NSR on base metals Resource delineation

Silicon(Nevada) Gold

Renaissance Gold Inc / Anglo Gold Ashanti NA 1.5% NSR Advanced Exploration

Pickett Mountain(Maine, USA)

Zinc, lead, copper, silver

Wolfden Resources Corp 1.35% GSR 43-101 Resource recently published

* net of mandatory government and social contribution deductions from gross sales

PRE-FEASIBILTY/FEASIBILITY/DEVELOPMENT

ADVANCED EXPLORATION


Property Primary Commodity

Explorer or Developer

Royalty Basis Status

Llano del Nogal(Mexico) Copper Evrim Resources Corp 1.5% NSR on PM; 1.0% NSR on BM

Early-stage exploration

Cuale(Mexico) Copper Evrim Resources Corp 1.5% NSR on PM; 1.0% NSR on BM


Jupiter(Nevada) Gold Renaissance Gold Inc 1.0% NSR


Kingscourt, Rathkeale(Republic of Ireland) Zinc

South 32 Base Metals Ireland 2% NSR on each Project Exploration

Arcas, Lia, Timon, Quiltro(Chile) Copper Rio Tinto 0.98% GSR Exploration

Cape Ray(New foundland) Gold Cape Ray Mining Limited 2.0% NSR Exploration

Lismore, Fermoy(Republic of Ireland) Zinc BMEx Ltd 2% NSR on each project Exploration

Gibson(British Columbia) Gold Canex Metals Inc Option to acquire a 1.5% NSR Exploration

Buchans(New foundland) Zinc Canstar Resources Inc 2% NSR on each Project Exploration

Daniel's Harbour (New foundland) Zinc Canstar Resources Inc 2% NSR Exploration

Vidalita, Jotahues(Chile) Gold Emu NL 0.49% NSR Exploration

Saint Patrick(Spain) Cobalt LRH Resources Ltd 2% GSR Exploration

Mythril(Quebec) Copper, Gold Midland Exploration Inc 1% NSR Exploration

Elrond, Gondor, Helm's Deep, Minas Tirith, Fangorn(Quebec) Gold Midland Exploration Inc 1% NSR Exploration

Moria(Quebec) Nickel Midland Exploration Inc 1% NSR Exploration

EXPLORATION

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Property Primary Commodity

Explorer or Developer

Royalty Basis Status

Shire(Quebec) Zinc Midland Exploration Inc 1% NSR Exploration

Copper Range(Michigan) Copper N/A

Option to acquire 1% NSR held by a third party Exploration

Voyageur(Michigan) Nickel N/A 2% NSR Exploration

Loro en el Hombro(Chile) Copper Revelo Resources Corp

0.98% NSR on gold; 0.49% NSR on base metals Exploration

Moosehead(New foundland) Gold Sokoman Minerals Corp 2% NSR Exploration

Iron Horse(Labrador) Iron Sokoman Minerals Corp

1% GSR; option to acquire additional 1.1% GSR Exploration

Sulieman, Buckingham, Smoky(Australia) Zinc Teck Australia Pty 1% GSR Exploration

Point Leamington(New foundland) Zinc Callinex Mines Inc. 2% NSR Exploration

Goethite Bay(Labrador) Iron Ore High Tide Resources Corp.

2.75% GSR on iron ore; 2.75% NSR on all other minerals Exploration

Sheerness West - CDC(Alberta) Thermal Coal

Westmoreland Coal Company Tonnes x indexed multiplier Exploration

EXPLORATION

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